Cyprus became member of the Economic and Monetary Union (EMU) upon accession to the European Union on 1 May 2004. As of 1 January 2008, Cyprus adopted the Euro, giving up its national currency (the Cyprus Pound). At the same time, it entered the eurozone and benefited from a single monetary policy. Greater international clout, stable prices, a common identity, ease of travel are among the multiple advantages offered by the euro.
The euro was first introduced as the single currency on 1 January 2002 and has already been adopted by 13 member states: Austria, Belgium, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal, Slovenia and Spain. Three of the EU-15 member states – Denmark, Sweden and the United Kingdom – still use their national currencies.
The euro symbol € is inspired by the Greek letter epsilon pointing back to the cradle of European civilisation and to the word “Europe”, crossed by two parallel lines to indicate the stability of the euro. The early definition of a distinctive symbol reflects the vocation of the euro to become one of the world’s major currencies. The official international abbreviation is EUR.
On its accession to the EU as a member state, Cyprus accepted the obligation to join the euro area once it meets the “Maastricht convergence criteria” laid down in the EC Treaty. This applies to all ten new member states which entered the EU on 1 May 2004, as well as to the two new member states which entered on 1 January 2007.
On 10 July 2007, the Council of the European Union approved Cyprus’ and Malta’s application to join the euro area on 1 January 2008.
On 1 January 2008, the euro (EUR) became legal tender in Cyprus, replacing the Cyprus pound (CYP) at the irrevocably fixed exchange rate of €1 = CYP 0.585274.
Successful entry in the euro area implies not only compliance with Treaty requirements, but also carefully planned and extensive practical preparations involving the public and private sectors, as well as the public at large. The prompt pre-distribution of euro cash to professional third parties prior to 1 January 2008 helped to ensure a smooth cash changeover, alleviate the logistical burden, and reduce the costs of dual currency circulation.
The government of Cyprus adopted a national changeover plan, and also a communication strategy under which a comprehensive communication campaign aimed at enabling the public to switch over to the euro with complete confidence was launched on 31 May 2006.
A partnership agreement between the Commission and Cyprus was signed in May 2006, ensuring that optimal use is made of the island’s own communication capacities. The Commission is working closely with the Ministry of Finance and the Central Bank of Cyprus, and also the European Central Bank, in defining and implementing the communication strategy and linking it with other activities.